Honourable Natalio D. Wheatley, Premier and Minister of Finance
at the Sixth Sitting of the Fourth Session of the Fourth House of Assembly
21st July, 2022
BVI Business Companies (Amendment) Act, 2022
Madam Speaker, I will now give a summary of the Bill entitled the BVI Business Companies (Amendment) Act, 2022, hereinafter referred to as the “Bill”.
This Bill seeks to amend the BVI Business Companies Act, 2004 by strengthening the BVI business companies’ regime in order to ensure continued compliance with international standards. This Bill follows an extensive review by and consultation with practitioners within the financial services industry and, when enacted, will make provision for the following:
- to permit a company wishing to engage in charitable or non-commercial activity while engaged in commercial business with a name ending provided in section 17 to do so but with the approval of the Registrar. This will ensure a proper segregation and accountability of the company’s commercial business from its charitable or non-commercial business;
- to abolish the bearer shares regime as even the current regime of immobilized and custodied bearer shares is proving challenging and unnecessary in light of emerging international standards on greater transparency;
- for streamlining and simplifying the existing rules relating to struck off companies, registered offices, registered agents, and restoration of companies to essentially end the company struck off regime so that a company that is struck off will be automatically dissolved upon publication by the Registrar of the striking off (subject to a 90 days’ notice to the company to regularize its status) before it becomes liable to be struck off and dissolved. It is important to note here that, if it is dissolved (following striking off), the company may still apply to the Registrar or the High Court to be restored to the Register. The stipulated period for doing so is 5 years;
- for reducing the period of notice registered agents need to give to their clients indicating their intent to resign from representing such clients is being reduced from 90 days to 60 days. In addition, a registered agent who has given notice may rescind the notice before the end of the notice period. The registered agent will be deemed to have resigned at the end of the notice period, so that there is no need (as is the current requirement) to file another notice indicating actual resignation;
- to make provision for the purposes of the retention of records and underlying documentation (including for AML/CFT purposes), for the registered office of a company to continue to be the registered office which the company had at the time of termination of any business relationship or completion of a one-off transaction. This will facilitate appropriate assistance in the event of a mutual legal assistance request;
- to make provision (with respect to existing companies) for the automatic resignation of a registered agent if a struck off company is not restored within 6 months after the coming into force of the Bill, when enacted. The company will then be automatically dissolved and can only be restored on a court application after satisfying the conditions stated in the Bill. For those legacy companies that fail to be restored within the 6-month period, a penalty will be applied;
- to establish an appropriate legal framework to require companies to file annual returns with their registered agents. The details and form of such filing are delegated to the Financial Services Commission to determine through the publication of an Order on its Website and will be the subject of further consultation with practitioners within the financial services industry;
- to make a new provision to amend section 118 thereby making it clear that the register of directors includes persons who act in the capacity of alternate directors, irrespective of how transient the appointment may be;
- to make provision whereby a list of directors of a company can be made available upon request. This is as part of the Territory’s continuing efforts to ensure full compliance with established standards relating to anti-money laundering, terrorist financing and proliferation financing;
- to amend section 184 of the principal Act to ensure that, while a company is free to continue outside the Virgin Islands, it should have an obligation to provide advance notice of such intention to its members and creditors. In addition, a notice of intention to continue outside the Virgin Islands should be published in the Gazette and on the company’s website (if any). These requirements will provide appropriate notice to persons who may, for any reason, object to the continuation and accordingly advise themselves of any step they may wish to pursue in relation to their company; and lastly Madam Speaker,
- to make provision to require voluntary liquidators to be persons who live within the Territory. This will facilitate the collection and retention of a liquidated company’s records within the Territory. However, where joint voluntary liquidators are appointed, at least one of them must be living in the Territory.
Madam Speaker, these amendments and improvements are required for the Territory to continue to remain compliant with emerging global standards in financial services. Honourable Members are kindly invited to consider the provisions of the Bill and lend their support accordingly.